Ackman seeks Allergan 'poison pill' end run

June 13, 2014 04:10 AM

June 13, 2014 04:10 AM

NEW YORK (AP) — Bill Ackman's Pershing Square Capital Management, seeking legal cover in its $53 billion takeover bid for Allergan, filed a lawsuit to confirm that its push for a special meeting of shareholders won't trigger a defensive "poison pill" plan from the Botox maker.

A Pershing affiliate filed the lawsuit with the Delaware Court of Chancery, it said, to remove any concern shareholders might have in participating in the special meeting.

Allergan adopted a shareholder rights plan after Pershing teamed with Valeant Pharmaceuticals in its takeover bid for the pharmaceutical. Under the plan, if any person or group acquires a 10 percent or greater stake in the company, other stock owners would be allowed to acquire additional shares at a discounted rate.

Pershing and Valeant went public with their takeover attempt in April and have increased their offer several times. Allergan has repeatedly rejected those offers as underpriced and risky, prompting Pershing and Valeant to go straight to the company's shareholders.

Pershing holds a 9.7 percent stake in Allergan and said that it asked for assurances last week from the company that it would not thwart the calling of a special meeting through a poison pill. Pershing says Allergan failed to provide the assurances that it had requested.